A federal jury in Houston has convicted former Enron chief executive officers Kenneth L. Lay and Jeffrey K. Skilling on charges of conspiracy, securities fraud, wire fraud, and making false statements.
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Download NowThe jury found Lay, 64, guilty on all of the six counts with which he was charged: conspiracy, two counts of wire fraud, and three counts of securities fraud. Lay was also convicted at a separate bench trial before Judge Lake of one count of bank fraud and three counts of making false statements to banks. The judge announced his verdict immediately after reading the jury verdict in the other case.
Skilling, 52, was convicted on 19 of the 28 counts pending against him: conspiracy, 12 counts of securities fraud, one count of insider trading, and five counts of making false statements to auditors. Skilling was acquitted of nine insider trading counts.
Sentencing for both defendants is scheduled for September 11, 2006. Potential maximum terms of imprisonment on the charges are as follows: five years on conspiracy, 10 years on each of the securities fraud charges, 10 years on each of the false statements to auditors charges, five years on the wire fraud charges, and 10 years on the insider trading charge. The defendants also face tens of millions of dollars in fines.
Prosecutors allege that Lay, Skilling, and other executives gave regulators, investors, and employees the false impression that the company and its business units were doing well financially. Thousands of employees lost their jobs and a big chunk of their savings after Enron's collapse. Many cheered the guilty verdicts for Lay and Skilling, according to several news reports.